493.11/1367a
The Secretary of State to the Secretary of the Treasury
Sir: I have the honor to refer to this Department’s letter of April 19, 1928,25 informing the Treasury Department that its suggestions relating to the procedure for handling the payments of the Chinese Boxer Indemnity remissions had been communicated to the Chinese Government and had been accepted by it.
A question has now arisen in connection with payment by the American Minister in the future of that portion of the Boxer Indemnity remitted under the terms of the Executive Order of July 16, 1925.26 The Secretary of the Treasury is the officer of this Government authorized and directed by that Executive Order to remit the sums in question. This Department desires, therefore, to lay before the Secretary of the Treasury the question that has arisen and would appreciate an expression of his views.
As will appear from reference to past correspondence and to the receipts for these payments transmitted in this Department’s communication of July 26, 1928,25 a check for each remission is made out in favor of the American Minister and is by him endorsed in favor of the Board of Trustees of the China Foundation for the Promotion of Education and Culture, the receipts themselves being signed by the two joint treasurers of the Board. The doubt that has arisen in the mind of the American Minister relates to the present status and identity of the Board of Trustees and has been occasioned by information received by him from different sources to the effect that the present Government of China has by administrative action abolished the constitution under which the Board has functioned since its creation and has ordered that vacancies on the Board shall be filled, not by the members of the Board through election, as provided in the constitution, but by certificates of appointment issued by the Chinese Government. The American Minister reports that Mr. Charles R. Bennett, an American citizen, one of the joint treasurers of the Board of Trustees of the China Foundation, has handed to the American Legation a copy of a letter dated August 11, addressed to him by Mr. Tsai Yuan Pei, Chairman of the National Educational Council, reading in part as follows:
“I beg to advise having received an official letter No. 3212 from the Secretary Department of the Nationalist Government, stating, ‘We have received the following instructions from the Nationalist Government: [Page 550] “The request of the National Educational Council to revise the regulations governing the Board of Directors of the China Foundation for the Promotion of Education and Culture is hereby acquiesced to: the original Board of Directors of the said Foundation is to be cancelled.”’”
This letter further indicated that certificates of appointment had been issued to fourteen persons as Trustees of the China Foundation, some of these persons having been Trustees formerly, and some of them being new appointees. Mr. Bennett informed the American Minister that he did not propose to answer this communication until it had been determined whether the certificate thus issued was acceptable, and that, taking into consideration the constitution and bylaws of the Board of Trustees, he questioned the legality of the new appointments. He also questioned whether the Board of Trustees thus appointed by the Nationalist Government could legally give a receipt for funds or legally disburse the funds on hand. Moreover, as the manager of the Bank which holds the current account and the securities of the China Foundation, he doubts whether his principals would allow him to honor the signatures of the officers of the Board of Trustees whose election or appointment had not been effected in accordance with the constitution hereinbefore mentioned. The American Minister informed the Department, in conclusion, that he had received a check covering a monthly remittance of the indemnity and he requested the instructions of this Department in regard to the issues raised by this action of the Nationalist Government.
In these circumstances I have the honor to inquire whether the Treasury Department desires that the American Minister shall be instructed to remit to the joint treasurers of the China Foundation future instalments of the Boxer Indemnity remitted under the terms of the Executive Order of July 16, 1925, and accept receipts signed by them on behalf of the reconstituted Board of Trustees, or whether it considers that payment may legally be made only to the Board of Trustees whose members have been appointed or elected in accordance with the constitution herein mentioned and whose duties are performed in conformity with its provisions.
For convenient reference copies of the constitution and Executive Order of July 16, 1925, are transmitted herewith.28
I have [etc.]
Assistant Secretary
- Not printed.↩
- Foreign Relations, 1925, vol. i, p. 935.↩
- Not printed.↩
- Constitution not printed. For Executive order, see Foreign Relations, 1925, vol. i, p. 935.↩